Correlation Between American Picture and Liberty Media
Can any of the company-specific risk be diversified away by investing in both American Picture and Liberty Media at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining American Picture and Liberty Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Picture House and Liberty Media, you can compare the effects of market volatilities on American Picture and Liberty Media and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in American Picture with a short position of Liberty Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Picture and Liberty Media.
Diversification Opportunities for American Picture and Liberty Media
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between American and Liberty is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding American Picture House and Liberty Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty Media and American Picture is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on American Picture House are associated (or correlated) with Liberty Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty Media has no effect on the direction of American Picture i.e., American Picture and Liberty Media go up and down completely randomly.
Pair Corralation between American Picture and Liberty Media
Given the investment horizon of 90 days American Picture House is expected to generate 7.19 times more return on investment than Liberty Media. However, American Picture is 7.19 times more volatile than Liberty Media. It trades about 0.05 of its potential returns per unit of risk. Liberty Media is currently generating about 0.09 per unit of risk. If you would invest 30.00 in American Picture House on August 24, 2024 and sell it today you would lose (1.00) from holding American Picture House or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Picture House vs. Liberty Media
Performance |
| Timeline |
| American Picture House |
| Liberty Media |
American Picture and Liberty Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Picture and Liberty Media
The main advantage of trading using opposite American Picture and Liberty Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Picture position performs unexpectedly, Liberty Media can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Liberty Media will offset losses from the drop in Liberty Media's long position.| American Picture vs. ZoomerMedia Limited | American Picture vs. Network Media Group | American Picture vs. New Wave Holdings |
| Liberty Media vs. Atlanta Braves Holdings, | Liberty Media vs. Madison Square Garden | Liberty Media vs. News Corp B | Liberty Media vs. News Corp A |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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